Sterling Tools Ltd

- No specific current or future fundraising plans through debt or equity are mentioned in the transcript. - When asked about investment from Gtake in the subsidiary, the management indicated uncertainty regarding the timing and value of such investment, suggesting no imminent fundraising there. - CAPEX plans are underway with internal funding: ₹50 crores plus for the current year and ₹28 crores planned for expansions in FY '24, with no mention of external financing. - Management stated many plans are dynamic, and they will update once finalized, but no explicit mention of raising funds through debt or equity at this time.

- The consolidated CAPEX plan for the current year (FY '24) is over ₹50 crores, and they are on track to complete this investment. - The bulk of the investments will be in new businesses; standalone business CAPEX will mainly be for maintenance. - FY '25 CAPEX planning is underway but still dynamic; final figures expected in about three months. - For the SGEM (subsidiary) business, the CAPEX plan was ₹28 crores for FY '24, with about ₹5 crores spent in H1 and the balance expected by March 31. - Capacity expansion in SGEM is ongoing and on track, aiming to utilize the full planned CAPEX. - Future CAPEX and investment numbers will be communicated once finalized, given the many "moving pieces" currently affecting planning.

- Sterling Tools aims to grow faster than the industry despite industry growth slowing to about 1%. - They expect moderate top-line growth in fasteners and electric vehicle (EV) segments, with some temporary dips due to policy changes and product realignment. - Partnership with Hyundai Kia Group is expected to contribute to future growth, though exact FY'25-'26 guidance is not provided yet. - Three-wheeler EV volumes are decent with five active customers, while LCV EV product launches are anticipated soon. - Capacity utilization is around 70%, with expansion plans, especially in the MCU segment, targeting increased output. - Export opportunities are being explored but currently yield slow visibility. - Growth in non-two-wheeler revenues reaching 50% by FY’25 is unlikely due to evolving industry timelines. - Steady-state ROCE expected between 15%-20%, with MCU business margins steady at 7%-9%.

- Sterling Tools expects standalone business EBITDA margins to approach around 15%, with current margins at 12.5% on a consolidated basis. - The company anticipates maintaining or marginally improving their current revenue run rate into H2 FY '24 and beyond. - Growth in FY '25-'26 is uncertain, particularly with the new partnership with Hyundai Kia Group, as product acquisitions are still evolving. - Non-fastener subsidiary business revenue grew 111% in H1 FY '24 but faces challenges due to subsidy changes affecting EV volumes; strong growth is still targeted but not 2x as earlier projected. - Capacity expansions, especially in the MCU segment, are underway to support future growth. - The company aims for steady-state ROCE in the 15%-20% range. - Overall, Sterling Tools is committed to outpacing industry growth at standalone and consolidated levels through customer acquisition, higher product content, and new product development.

- Sterling Tools currently has 16 active customer contracts with vehicles sent for homologation using their products. - There are about 40 additional engagements with prospective customers, indicating a healthy pipeline. - Not all contracts are in high-volume production; some are in homologation or trial marketing phases. - The company has multiple contracts with two-wheeler OEMs, including large players like Ola and others with varying volumes. - They are also negotiating with large Tier-1 customers for export cycles, though visibility remains slow. - The company tracks the number of contracts and customer engagements rather than a traditional order book due to the variable nature of vehicle launches and volumes. - Growth visibility relies on customers' vehicle launches and volume ramps rather than fixed orders.